Suppose you had just gone long two lots of Syarikat ABC stock at a price of...
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Suppose you had just gone long two lots of Syarikat ABC stock at a price of $ 8.00 each, for a total investment of $ 1600 (1 lot =100 units of shares). You wish to protect yourself from any short-term downside movement in price. The following quotes are available. 30-day ABC 8.00 call @ 0.35 30-day ABC 8.00 put @ 0.25 (i) State the name of your strategy. (ii) Outline the above strategy. (iii) Graph the strategy (plot the position, label all axes, max, min points specify the option and state the long or short position). (iv) Outline the risk profile. (v) State the maximum profit, maximum loss, and breakeven point(s) in $ value. Suppose you had just gone long two lots of Syarikat ABC stock at a price of $ 8.00 each, for a total investment of $ 1600 (1 lot =100 units of shares). You wish to protect yourself from any short-term downside movement in price. The following quotes are available. 30-day ABC 8.00 call @ 0.35 30-day ABC 8.00 put @ 0.25 (i) State the name of your strategy. (ii) Outline the above strategy. (iii) Graph the strategy (plot the position, label all axes, max, min points specify the option and state the long or short position). (iv) Outline the risk profile. (v) State the maximum profit, maximum loss, and breakeven point(s) in $ value.
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Step 11 i The name of the strategy is a long call and long put ii The strategy involves purchasing a ... View the full answer
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